Buying a Vehicle Tracking Software
A lot our customers are not first time vehicle tracking system buyers. In the Philippines, it is mostly about price and this is where procurement gets in the way of users. The Business Mapper – Asset Tracker team have collected various facts and feedback from customers and have summarized a guideline here.
Vehicle Tracking is NOT CHEAP
Vehicle tracking is not cheap in absolute terms, but it may be cheap in relative terms. If a buyer is moving high value cargo or VIP’s then vehicle tracking is cheap. The trouble with vehicle tracking is that most of its benefits can only be realized in hindsight. The buyer needs to clearly understand which assets should be tracked and why. Best way to do this is by doing risk assessments, what happens if this asset gets hijacked or is exposed to unnecessary risk due to driver negligence?
Pricing Models: Software, Tracking Intervals and GPS units
Subscription - Most service providers offer vehicle tracking in a subscription model package. Starting with a base rate and various rates for Tracking Intervals (they may call this reports). As a buyer be sure you understand what these interval rates are and try to determine the full Operational Cost of a vehicle Per Day (OCPD).
Tracking Intervals - The ideal tracking interval for a proper vehicle tracking system is anywhere from 2-5 minutes. That means roughly 480 intervals per operational day, excluding door and engine reporting events. A buyer needs to calculate the cost per day based on a vendors rates.
- Operation Cost Per Unit Per Day = (480 – Subscription Allocated Interval Per Day = Chargeable Intervals * Interval Unit Price )
GPS Units - This is often a price sensitive item. In most cases you get what you pay for. The cheaper they are, the nastier they get. Cost-savings will certainly be shadowed by maintenance costs and downtimes.
- If a device goes down, the vehicle is untracked for the duration of the service
- A support technician needs to remove the device and fix it (downtime at the depot for the vehicle) ask the vendor if they charge for this.
Software - If a buyer is running a fleet, there should be an operational dashboard. There simply is no way to manage 50 vehicles using a map interface without going through each vehicle in detail. Software should support other GPS devices, if newer GPS tracker models come out, the software should be able to adopt to it and use it together with older devices.
Do a Total Cost of Ownership (TCO) analysis: 3-year system cost analysis
- CAPEX (Servers, Internet Connectivity, Licensing)
- OCPD (with ideal tracking intervals)
- Mainetance Costs (Downtimes and support costs)
- Subscription Costs
List down success criterias for the System
- Risk Mitigation of high value assets
- Operational Standards in route selection and driver behavior